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AMERICAN MORNING

Hostage Deadline; Plot Against Blair's Son?; Market Selloff; Suicide Ruling

Aired January 18, 2006 - 06:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


MILES O'BRIEN, CNN ANCHOR: Good morning, I'm Miles O'Brien.
SOLEDAD O'BRIEN, CNN ANCHOR: And I'm Soledad O'Brien.

An American journalist kidnapped in Iraq. A new tape, a chilling message and a very short deadline. We're going to take you live to Baghdad this morning on this story.

And a developing story overnight about a possible plot to kidnap the son of Britain's Prime Minister Tony Blair. We'll be live on Downing Street this morning.

(BEGIN VIDEO CLIP)

MAYOR RAY NAGIN, NEW ORLEANS: If I could taking anything back, that's what I would take.

(END VIDEO CLIP)

M. O'BRIEN: New Orleans Mayor Ray Nagin with an apology the day after he spoke of a chocolate city and an angry God. We'll tell you what he regrets.

And lobbygate, in the wake of a major scandal, Democrats say they have a way to fix the mess in Washington. We'll take a look.

And a selling frenzy in Tokyo forcing the Nikkei to close early over fears of a market crash there. How will Wall Street respond this morning?

All that ahead, but we begin in Iraq where a kidnapped American journalist may have less than 72 hours to live. Video of Jill Carroll played on Al-Jazeera TV Tuesday. The network says the tape came with a message. It says Carroll will be killed in less than three days if all female Iraqi prisoners are not released.

Michael Holmes live now in Baghdad with us.

Michael, what's the latest?

MICHAEL HOLMES, CNN CORRESPONDENT: Hi there, Miles.

Yes, that video of course was very short. There was no audio on it. You could see Jill talking, but there was no audio, so we don't know what she was saying. The family has issued a statement, however, Miles. Here's just a little bit of that statement. It says "Jill is a friend and a sister to many Iraqis and has been dedicated to bringing the truth of the Iraq war to the world. We appeal for the speedy and safe return of our beloved daughter and sister." Now that's signed by Jim, Mary Beth and Katie Carroll.

Miles, as you said, Jill was taken on January 7 in a risky part of the city. It was a highly organized attack. After she had been trying to get an interview with a senior Sunni politician, she was seized. Her 32-year-old translator also. He was later found dead.

Now in terms of the demands, Miles, it's interesting, we don't know specifically whether the kidnappers are saying all Iraqi female prisoners or those who have been detained as insurgents or linked to the insurgency.

We've been told by a Justice Ministry spokesman there are only 10 female detainees in the country who have been arrested by the U.S. military. Six of those were due for release in the days ahead anyway, unrelated to the kidnappers' demands -- Miles.

M. O'BRIEN: But, Michael, there is no talk of any sort of negotiation which would allow for a release of those others?

HOLMES: No, no, and I doubt that you would see any admission by the U.S., or even the Iraqi authorities, that they would negotiate the release of any of those held in custody in exchange for this. That's not the modus operandi of the coalition forces, nor indeed the Iraqi government.

Always with these cases, a lot goes on in the background. The Justice Ministry spokesman that we spoke with said that the 6 of the 10 were going to be released anyway. This was completely unrelated to the kidnapping demands.

M. O'BRIEN: Michael Holmes, thank you very much -- Soledad.

S. O'BRIEN: We're following a developing story out of Britain this morning, police sources there tell the British media that they knew of suggestions of a plot to kidnap Prime Minister Tony Blair's 5- year-old son.

Robin Oakley is at Number 10 Downing Street this morning, which of course is the prime minister's residence in London.

Hey, Robin, good morning.

ROBIN OAKLEY, CNN CORRESPONDENT: Good morning, Soledad.

Well this is a story which comes with a pretty large dose of media froth on the top. A story run, first of all, in "The Sun" newspaper in Britain. And you're right to say that police had picked up suggestions from extremists on the fringe of a group that campaigns for fathers to get more access to their children in split marriage cases. And what we're hearing from police sources, they won't say anything on the record, nor will Number 10 Downing Street. But we are hearing that they pick up suggestions from a group, perhaps even talking in a bar or something like that, that they might, as their next stunt, get round to kidnapping the prime minister's 5-year-old son, Leo Blair.

But it has to be said nobody has been arrested, no plot was actually put into operation and the police indeed doubt if these people, such as they are, ever had the capacity to carry out a kidnapping. We're not talking about something here on the level of al Qaeda or something like that -- Soledad.

S. O'BRIEN: So it's been considered more of a stunt, like a PR stunt sort of thing, as opposed to an actual plotted criminal kidnapping of a little boy? Is that the correct reading?

OAKLEY: Yes, that's the kind of thing it is. The group that these people were allegedly associated with, extremists, who were formerly in Fathers for Justice who campaigned for, as I was saying, fathers to get more access to their children.

They've been famous for a number of stunts. For example, breaching the security at Buckingham Palace. Two hundred of them dressed up as Santa Claus and went to the Lord Chancellors Department to campaign for changes in the law. We've had them throwing flour bombs. A couple of them managed to breach common security in the House of Commons and throw a couple of condoms filled with purple flour at Tony Blair. That's the kind of thing they have done up until now.

But the founder of Fathers for Justice is saying they would have absolutely nothing to do with a stunt like this because they are all about uniting fathers with their children, not depriving them of their children. And they are actually discussing now as to whether they should disband because of extremists taking over and going for this sort of action -- Soledad.

S. O'BRIEN: Interesting. All right. Robin Oakley for us this morning. What a strange story.

Thanks, Robin -- Miles.

M. O'BRIEN: Also following some overnight developments from the world's second largest stock exchange, a huge selloff on Japan's Nikkei. So many sell orders, in fact, it forced an early close of trading. The market has lost about $300 billion in value in three days.

CNN's Atika Shubert joins us now via videophone from Tokyo.

Atika, what happened?

ATIKA SHUBERT, CNN CORRESPONDENT: Well, Miles, essentially there was so much trading on the stock exchange today that the stock exchange had to shut down 20 minutes early. It was simply overwhelmed with the amount of transactions. And that's the first time that it's ever happened that they have had to shut down the exchange to prevent the system from actually crashing.

Now this all started about two days ago, on Monday night, when there was an investigation opened up into alleged security trading violations of an Internet company here known as Livedoor. Now that was the initial event that triggered this massive selloff. The Nikkei index today plunged by 2.9 percent as this massive selloff continued.

And the trading went up to about almost four million transactions. And apparently the exchange can only handle about 4.5 million transactions. And for that reason, exchange officials say they had to suspend trading. And they will continue to suspend trading tomorrow for an extra half-hour, delaying the trading day in the afternoon from 12:30 local time to 1:00, again, to prevent the system from crashing. And they say they are going to continue to do that until the volume of trading eases off.

M. O'BRIEN: Atika Shubert in Tokyo, thank you very much.

So what does this mean for your wallet? We'll look at the potential impact on Wall Street with Carrie Lee in just a few moments -- Soledad.

S. O'BRIEN: A low for the Bush administration, the Supreme Court has upheld Oregon's assisted suicide law. The ruling confirms that states have the authority to regulate medical practices. It's drawing passionate reaction from both sides on the issue.

Here's Brian Todd.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): Charlene Andrews is a late-stage breast cancer patient from Oregon who wants to die on her terms, not have the government or the disease decide when and where. Andrews is thrilled with the Supreme Court's six to three ruling upholding Oregon's assisted suicide law.

CHARLENE ANDREWS, CANCER PATIENT: The U.S. Supreme Court did justice in recognizing the feelings and the needs of the people who have this terminal illness to be able to use that process in a compassionate and dignified manner.

TODD: The Bush administration had argued against that process based on the Controlled Substances Act, which makes it illegal to take or administer powerful drugs that the Justice Department argued have no legitimate medical purpose. New Chief Justice John Roberts was in the minority siding with that argument.

But writing for the majority, Justice Anthony Kennedy stated, "The U.S. attorney general simply doesn't have the power to block a state law that's been passed twice by voters. A victory for states' autonomy doesn't appease those who believe assisted suicide goes against the basic premise of a doctor's oath." JAMES BOPP, NATIONAL RIGHT TO LIFE: It is not medical treatment. It is the absence, it is the opposite of medical treatment. It is doing harm to your patient.

TODD: Other opponents believe the law discriminates against the elderly and devalues people with disabilities. Experts on law and medical ethics say the debate over end-of-life issues may well turn with this ruling.

LAWRENCE GOSTIN, CENTER FOR LAW & THE PUBLIC'S HEALTH: I predict that a lot of states are going to say, well, it matters to my citizens about how they die. And I want to give them this option.

TODD (on camera): Another expert says those who favor the law can cite Oregon's track record. Since the law went into effect in 1997, he says he knows of no cases of abuse, no instance where a patient was mistakenly induced into suicide.

Brian Todd, CNN, at the Supreme Court.

(END VIDEOTAPE)

S. O'BRIEN: Supporters of the assisted suicide law say they expect the decision will be challenged in Congress.

M. O'BRIEN: Some backpedaling on the day after the New Orleans mayor seemed to offend almost everyone. Ray Nagin is backing off the surprising comments he made on Martin Luther King Day, saying a rebuilt New Orleans would be a chocolate city.

He says he meant to reassure African Americans not to inflame other New Orleanians. And he wishes, he said, that he hadn't said God sent hurricanes to punish America for the Iraq war and for to punish African Americans for -- as he put it -- "not taking care of ourselves."

(BEGIN VIDEO CLIP)

NAGIN: If I could take anything back, that's what I would take, any references to God. I think that was inappropriate for that particular setting. It was something that I had discussed with a minister several weeks before, and for some reason it became top of mind and it became part of that speech. It was totally inappropriate.

(END VIDEO CLIP)

M. O'BRIEN: Nagin says he asked for forgiveness. He is well known for shooting from the hip. This may not be the end of it, his political opponents are likely to bring up his remarks in the upcoming re-election campaign.

S. O'BRIEN: Yes, no doubt about that.

M. O'BRIEN: No doubt. I think that's safe to say.

S. O'BRIEN: Let's -- and if they don't, they probably shouldn't be running.

M. O'BRIEN: They're not paying attention. Yes.

S. O'BRIEN: Let's get right to Chad Myers. He's at the CNN Center with the first look at the weather this morning.

Hey, Chad, good morning.

CHAD MYERS, CNN METEOROLOGIST: Good morning, Soledad.

(WEATHER REPORT)

Back to you guys.

S. O'BRIEN: All right, Chad, thanks.

M. O'BRIEN: All right, thank you -- Chad.

MYERS: You're welcome.

M. O'BRIEN: Still to come on the program, an update on a story we've been following for you. A really gut wrenching story, the custody battle over a little girl on life support. Her stepfather is accused of nearly beating her to death but demanding a say in her hospital care, nevertheless. We'll tell you what the court told him.

S. O'BRIEN: Also this morning, we're on a huge selloff at the Tokyo stock exchange. How is it going to affect Wall Street? A look at that this morning.

M. O'BRIEN: And later, health problems for singer Isaac Hayes. Details on why he checked into a hospital ahead on AMERICAN MORNING.

(COMMERCIAL BREAK)

S. O'BRIEN: Six fifteen in the city as we're rolling...

M. O'BRIEN: A little white (ph) this morning, a little warmer, though.

S. O'BRIEN: Yes. Yes, which I'll take it.

M. O'BRIEN: Yes.

S. O'BRIEN: It's not so bad.

M. O'BRIEN: Bring it on.

Carol...

S. O'BRIEN: Welcome back, everybody.

M. O'BRIEN: Good to have you with us.

Carol Costello has some headlines for us.

Good morning -- Carol.

CAROL COSTELLO, CNN ANCHOR: I do. Good morning, and good morning to all of you.

We have new video this morning of a kidnapped American in Iraq. Her abductors threatening to kill her if the U.S. does not release all female Iraqi prisoners. Al-Jazeera Arab Network TV aired a brief video of Jill Carroll. She was kidnapped January 7 in Baghdad. The group holding her issued a deadline of 72 hours on Tuesday.

According to a Reuter's report, U.S. military officials say they are holding eight Iraqi women in prison. A U.S. State Department spokesman says every effort is being made to bring Jill Carroll back home.

Do you remember Michael Fortier? Fortier was a key witness in the Oklahoma City bombing trial. He was sentenced to 12 years in prison in 1998 for knowing about the bombing plot but not telling authorities. On Friday he is scheduled to get out of prison. And, as you might imagine, there is mixed reaction from family members of the bombing victims and members of that community.

Settlement has been reached between the city of New Orleans and residents whose homes were damaged by Hurricane Katrina. Property owners will get at least seven days notice before the homes are demolished. Notifications will be published in "The Times-Picayune" newspaper, as well as being sent to the owner's last known address. The city is also setting up a toll free number about home demolitions.

Senator Hillary Rodham Clinton's plantation remark is drawing fire. The senator from New York said during a Martin Luther King Day speech that House leaders have run the chamber like a plantation. House Speaker Dennis Hastert calls her remarks -- and I'm quoting here -- "a little bit over the top." New York Republican Congressman Peter King says Clinton should be ashamed and that it's definitely using the race card. But Al Sharpton, who hosted Monday's event, says he defends Senator Clinton's comments.

There will be no Super Bowl for a football fan. You remember this football fan. Did you catch this? You remember this, Nathan Mallett ran onto the field during a Browns-Steelers game last month and he got tackled to the ground by the Pittsburgh Steelers linebacker James Harrison. Let's see that take down again. Bam!

S. O'BRIEN: All right.

COSTELLO: Well Mallett is now paying for his indiscretion. He's been sentenced to spend Super Bowl weekend in jail with no TV or radio privileges.

MYERS: Man!

COSTELLO: And Mallett was also ordered not to attend any Browns games for five years. And that would actually hurt him more, because of course the Browns, well, they're not going to be in the Super Bowl this year -- Chad. MYERS: No Super Bowl for you.

Good morning, Carol.

(WEATHER REPORT)

S. O'BRIEN: All right, Chad, thank you very much.

Business news now, big questions hanging over Wall Street. Tech stocks to the Tokyo market, lots to worry about. A lot to watch.

CARRIE LEE, CNN CORRESPONDENT: Very dramatic in Tokyo. The Nikkei actually ended up closing early because of a raid at an Internet company called Livedoor that trades there. Now authorities raided that company because of some fears about accounting, the company cooking its books, as it were.

Well bottom line, investors heard about that, sold off shares all over the place on the Nikkei. The exchange ended lower by 3 percent. Trading was halted 20 minutes early.

And you can bet that this is having an effect on the early market action here. Of course trading doesn't officially get under way until 9:30. But futures, especially technology futures on the Nasdaq, are looking very, very weak. The weakest that I've seen in quite some time.

Now the NYSE is of course the world's largest exchange. Usually Asia follows us. But it's like a wheel, you know it always -- one exchange affects the other, so.

S. O'BRIEN: But all of this over Livedoor, which, have you ever heard of Livedoor Internet?

(CROSSTALK)

M. O'BRIEN: I have not heard of Livedoor. What do they do?

LEE: Now they're a buy (ph). They're an Internet company. We're not that familiar with it. Well that's part of the story.

The other part of the story, we have our own tech problems here today. A couple of weak profit reports last night. Intel, Yahoo! selling off huge last night.

Let's start with Intel. They missed the mark on sales. The world's largest chipmaker says slower sells of desktop PCs and weaker prices led it to miss sales targets. The stock was down over 9 percent last night. So that's certainly weighing on techs.

Yahoo!, let's take a look at that company. Profits up 80 percent year over year, but still missing the Wall Street expectation here. Competition from Google not helping, also a weaker ad sales outlook. And shares fell 13 percent after the bell.

IBM also reported shares there ended up holding pretty steady. But still, Yahoo!, Intel weighing heavily on tech.

S. O'BRIEN: Heard of those.

LEE: And the Nikkei not helping either. So brace yourselves for some serious red arrows at 9:30.

S. O'BRIEN: And not just Livedoor this morning.

LEE: Exactly.

M. O'BRIEN: Yes. Yahoo! up 80 percent and that's bad news. It's a wacky world, isn't it?

LEE: Those were profits. You know expectations for these Internet companies...

M. O'BRIEN: Yes.

LEE: ... have been so high, so something has got to give sooner or later, right?

M. O'BRIEN: All right, Carrie, thanks.

S. O'BRIEN: Thank you.

Carol's got a look at what she's got for us in "Morning Coffee" just ahead.

COSTELLO: I do. Here's what's coming up. Things that make you go (ph). William Shatner gives a piece of himself to charity. That would be his kidney stone. Stay with us for "Morning Coffee" on AMERICAN MORNING.

(COMMERCIAL BREAK)

M. O'BRIEN: That's the newsstand, wasn't it? Is that the newsstand in Columbus Circle there? Yes. Yes.

COSTELLO: But not a very pretty place in New York...

S. O'BRIEN: Everybody is up and working this morning is what that shot says.

Good morning, welcome back.

Let's get right to "Morning Coffee."

COSTELLO: Let's, because a lesson for you. When you slam someone for allegedly poor behavior, you better make sure you are as clean as a whistle. Case in point, Senator Ted Kennedy and the...

M. O'BRIEN: And who is really...

COSTELLO: Well...

M. O'BRIEN: ... clean as a whistle, right? COSTELLO: Well certainly not Senator Ted Kennedy,...

M. O'BRIEN: Yes.

COSTELLO: ... in this instance, and the Owl Club.

During last week's Supreme Court confirmation hearings, Kennedy criticized Judge Samuel Alito over a college club. Alito is a member of an alumni group at Princeton that doesn't allow women. But then word got out that Kennedy is a member of a similar club at Harvard. So now he has asked the Owl Club to take him off the books. Kennedy says he hasn't been active in the all-male club since he left college back in the '50s. But he did send them a check for $100 last year.

S. O'BRIEN: None of the finals clubs (ph) at Harvard accept women. And some of the ones at Yale do.

COSTELLO: Really?

S. O'BRIEN: Yes.

(CROSSTALK)

COSTELLO: Well Mr. Kennedy is not a member of the Owl Club anymore.

M. O'BRIEN: A bit of chauvinism.

S. O'BRIEN: Why yes it is.

COSTELLO: It is indeed.

You could call it charity where no man has gone before. And wouldn't you know it, Captain Kirk is behind it, William Shatner. He passed a kidney stone and someone is going to have a new house. Shatner sold his kidney stone for $25,000, and that money will be going to the Habitat for Humanity. You know they build homes for the needy.

M. O'BRIEN: OK.

COSTELLO: After the sale, Shatner said someone might want to actually heat the stone, because it was so large, and make it into a diamond so they can wear it on...

M. O'BRIEN: What's that all about?

COSTELLO: OK, that's too much information.

M. O'BRIEN: Yes. Yes.

COSTELLO: Anyway, the $25,000 was paid out by online casino GoldenPalace.com. And maybe you remember them for some of their other interesting purchases. They bought that famous Virgin Mary cheese sandwich.

S. O'BRIEN: Yes.

COSTELLO: Remember the half-eaten thing?

M. O'BRIEN: Yes, that was like about $25,000, wasn't it?

COSTELLO: It's on display.

M. O'BRIEN: Yes. Yes. Yes.

COSTELLO: They also know -- they also own the naming rights to a new monkey species found in South America. They even bought ad space on the chest of a baseball star's ex-wife. But I won't go into that.

M. O'BRIEN: So if they build the house, it'll have a pool, right, kidney shaped, you think?

(CROSSTALK)

COSTELLO: I like that one.

M. O'BRIEN: Yes.

S. O'BRIEN: No, you don't. That's horrible.

COSTELLO: I actually did like it.

A story for all of you wondering out there...

M. O'BRIEN: Thank you. Thank you.

COSTELLO: ... if the O'Brien's sitting here to my left are related. We get lots of e-mails about that. They say no. But I say yes.

M. O'BRIEN: We're all -- all O'Briens are related, right? Isn't that true?

COSTELLO: Well it may be true, because scientists have found the father of modern Ireland. Researchers in Dublin say 1 out of every 12 Irishman can be traced back to a single person. He's a fifth century king known as Niall of the Nine Hostages.

S. O'BRIEN: A king. High five. Join hands on that (ph).

M. O'BRIEN: Right (ph). I thought it was O'Brien Brew (ph). What happened to O'Brien Brew?

(CROSSTALK)

COSTELLO: Yes. Yes, I mean he's known as...

S. O'BRIEN: He's known as O'Brien Brew, too.

M. O'BRIEN: Yes. Yes.

COSTELLO: He's known as Niall of the Nine Hostages. The nine hostages part can't be nine (ph). But anyway...

M. O'BRIEN: Well it was a rough time.

COSTELLO: It was a rough time.

Anyway, the scientists say up to three million men worldwide could be traced back to King Niall. Niall had 12 sons and they had sons and so on and so on and, yes. And...

M. O'BRIEN: Eventually a daughter came into the picture somewhere along the way, I guess.

COSTELLO: Maybe, I don't know, but they all had a lot of sons. So of course that left me to wonder, if we follow the branches of that family tree far enough where do we end up? We did a lot of work on this morning, as you can see.

S. O'BRIEN: Clearly.

M. O'BRIEN: It's an upside down tree, though.

S. O'BRIEN: And you can...

M. O'BRIEN: And you see Niall should be at the bottom, right?

COSTELLO: Whatever. And you can clearly see that Miles and Soledad...

M. O'BRIEN: Just for the record.

COSTELLO: ... are cousins.

M. O'BRIEN: There you have it.

S. O'BRIEN: I love you, man.

M. O'BRIEN: What's the secret handshake again?

S. O'BRIEN: Yes.

(CROSSTALK)

M. O'BRIEN: We can't show it. We can't show it.

S. O'BRIEN: No, no, we'll do it later.

M. O'BRIEN: That's a bet (ph). All right.

COSTELLO: I'm glad I brought you together.

S. O'BRIEN: Thank you.

M. O'BRIEN: Such a happy family.

S. O'BRIEN: Sure.

M. O'BRIEN: Thank you, Carol.

This morning's top stories are straight ahead, including more fallout from lobbygate and the Jack Abramoff scandal. Republicans are vowing to cleanup corruption, but how far are they willing to go? That's ahead on the all O'Brien AMERICAN MORNING.

(COMMERCIAL BREAK)

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